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February 23rd, Futures News: Economies.com analysts latest view: Brent crude oil futures prices have retreated, attempting to find a higher retracement low as a base to help them gain the necessary bullish momentum for a rebound and further gains. In the short term, the main bullish trend remains dominant, and prices continue to trade above the 50-day EMA, further enhancing the likelihood of a short-term rebound. Meanwhile, the Relative Strength Index (RSI), after digesting overbought conditions, has shown positive converging signals, providing strong support for Brent crude oil futures to achieve new gains.Despite the ban on European Central Bank staff receiving compensation, ECB President Christine Lagarde still received €140,000 from the Bank for International Settlements.Even as the US and Iran signaled their intention to negotiate, the risk of a US military strike against Iran remains. Russias Sputnik news agency reported on February 22 that, citing a former CIA operative, US media outlets stated that the US might launch a military strike against Iran on February 23 or 24.The China Earthquake Networks Center officially reported that a magnitude 3.3 earthquake occurred at 12:34 on February 23 in Yuli County, Bayingolin Mongol Autonomous Prefecture, Xinjiang (40.97 degrees north latitude, 84.31 degrees east longitude), with a focal depth of 18 kilometers.Former Bank of Japan board member Makoto Sakurai stated that if the yen weakens again before the expected Japan-US summit in March, the Bank of Japan could raise interest rates as early as March. Sakurai said, "Intervention in the exchange rate will only have a temporary effect on curbing yen selling pressure. The best way to deal with a weak yen is for the Bank of Japan to raise interest rates." Sakurai added that further yen depreciation would push up inflation by increasing import costs and offset some of the downward pressure from government fuel subsidies. He further added that if a significant yen depreciation is needed, the Bank of Japan could raise interest rates as early as March, citing the expectation of strong wage growth from companies and unions in the spring annual wage negotiations.

The USD/CAD exchange rate moves above 1.3560 in advance of US/Canadian employment data, as oil prices consolidate

Alina Haynes

Jan 06, 2023 11:15

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In the early Asian session, the USD/CAD pair is bouncing within a narrow range of 1.3560-1.3580. The Canadian dollar has retreated to a sideways pattern following a rise from the psychological support level of 1.3500. After the upbeat United States Automatic Statistics Processing (ADP) Employment Change data prompted a trend of risk aversion, market participants demonstrated higher demand for the US Dollar.

 

Rising expectations of a long-term aggressive monetary policy by the Federal Reserve (Fed) enhanced the appeal of the safe-haven currency, which pushed the US Dollar Index (DXY) to the important resistance level of 105.00. Additionally, it boosted 10-year US Treasury yields above 3.72 percent. In the interim, after a fall on Thursday, demand for S&P500 futures has increased, indicating a minor improvement in investors' risk appetite.

 

Compared to the predicted 150K, the US economy has created 235K jobs for job seekers, according to the US ADP. Stronger labor demand is undoubtedly indicative of a healthy economy, but in times of soaring inflation, it provides the Fed with a solid reason to delay a rate cut in the near future.

 

Investors will keenly examine Friday's release of US Nonfarm Payrolls (NFP) data in order to obtain deeper insight into the status of the US labor market.

 

Likewise, the Canadian Dollar will respond to the release of Employment data. Compared to the earlier estimate of 10k, the net increase in payrolls for December is expected to be 8k. The jobless rate may increase slightly to 5.2%.

 

Before the release of the official US Employment report, the price of oil exhibits rangebound behavior. Since the Covid-19 scenario may reach its culmination more quickly, the black gold may gain strength. Notably, Canada is the United States' leading oil exporter, and higher oil prices strengthen the Canadian Dollar.

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